"The RBA managed to surprise us, upgrading all key forecasts more than we anticipated," said Prashant Newnaha, senior Asia-Pacific rates strategist at TD Securities.
Since the last meeting, the government has introduced new measures to cool the red-hot housing market which should make it easier for the central bank to maintain its stimulus.
"If the AOFM sticks with issuance of A$230 billion there will be a significant pre-funding of next year's deficit, which is on track to be much smaller than expected."
"And with crude (oil) prices leading commodities lower, and iron ore following quickly behind, the risks of further weakness for the A$ are clear to see."
"There's a tide of higher rates across the board, and whether the US does an extra five basis points than Germany is neither here nor there," said Jason Wong, senior market strategist at BNZ in Wellington.
New Zealand inflation expectations for the year posted a large rise to 1.77%, from 1.23% previously, a survey by the central bank showed, while two-year expectations rose 30 basis points to 1.89%.
The kiwi dollar held firm at $0.7173, after finding support at $0.7150. It remains far from the January top of $0.7314 and has resistance at $0.7225 and $0.7246.
Figures out Thursday showed prices for iron ore exports jumped by almost 12% over the December quarter, delivering a big boost to mining profits and government tax receipts.